U.S. and Australia Push for Financial Connectivity in Pacific Amid China's Rising Influence

U.S. and Australian officials are committed to enhancing financial connectivity in the Pacific as China gains influence in the region. Western banks are de-risking to meet regulations, limiting access to U.S. dollar-denominated accounts for Pacific Island nations. Steps are being taken to bolster Pacific's financial integration and resilience.

U.S. and Australian officials have pledged to improve financial connectivity in the Pacific during a two-day forum, amid growing Chinese influence. These discussions aim to reinforce banking services for the Pacific Island nations as Western banks withdraw or limit operations, affecting access to U.S. dollar-denominated bank accounts.

Speaking at the forum, Australian Assistant Treasurer Stephen Jones emphasized Australia's commitment to being the preferred partner for Pacific Island nations in both banking and defense. He subtly criticized nations prioritizing their own interests, implying concerns about China without explicitly naming it.

U.S. Treasury Undersecretary Brian Nelson highlighted the strategic importance of the Pacific and reaffirmed Washington's commitment to supporting financial connectivity and economic resilience in the region. He noted that bank de-risking has disproportionately impacted the Pacific, impeding financial stability. U.S. Treasury Secretary Janet Yellen echoed this sentiment, emphasizing a secure, connected Indo-Pacific region.

(With inputs from agencies.)